Explaining Mortality Dynamics: The Role of Macroeconomic Fluctuations and Cause of Death Trends

Abstract

Using data for six OECD countries over the period 1950-2006, this paper studies the impact of macroeconomic fluctuations and cause of death trends on mortality dynamics in the Lee-Carter mortality forecasting model. The key results of this study are: (i) Periods can be identified in which the Lee-Carter mortality index kt correlates significantly with macroeconomic fluctuations. (ii) A few causes of death such as diseases of the circulatory system, influenza and pneumonia, and diabetes mellitus account for a large fraction of the variations in the Lee-Carter mortality index kt. (iii) Most cause-specific mortality rates show pronounced trends over the past decades. These trends change the composition of deaths and alter how total mortality reacts to external factors such as macroeconomic fluctuations.

Keywords: stochastic mortality, Lee-Carter model, external factors, cause-specific mortality

JEL Classification: J11, E32